Muscat reshuffles Cabinet in response to Panamagate and keeps Mizzi with him

Konrad Mizzi to be retained as minister without portfolio, former minister Manuel Mallia reintroduced to Cabinet • Leo Brincat to be nominated to European Court of Auditors, Keith Schembri - also implicated in Panama Papers - retained as chief of staff

No sackings, but promotions: Schembri and Mizzi stay on (clockwise from top) while Manuel Mallia is back in the Cabinet and Leo Brincat gets a kick upstairs to the European Court of Auditors
No sackings, but promotions: Schembri and Mizzi stay on (clockwise from top) while Manuel Mallia is back in the Cabinet and Leo Brincat gets a kick upstairs to the European Court of Auditors
Prime Minister announced Cabinet reshuffle

Konrad Mizzi, the minister under pressure to resign for having opened an offshore firm in Panama, will not be sacked, Prime Minister Joseph Muscat has announced.

In what will be interpreted by critics as a cosmetic measure aimed at quelling public outrage over ‘Panamagate’, Muscat will retain Mizzi as a minister ‘without portfolio’, keeping him under his purview in the Office of the Prime Minister, while the prime minister himself will take Mizzi’s energy portfolio.

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19:13 First comments from Simon Busuttil
Opposition leader Simon Busuttil has said Prime Minister Joseph Muscat is blackmailed by his minister Konrad Mizzi and chief of staff Keith Schembri, the two officials revealed to have opened two offshore companies in Panama during their time in office.

“Today we have a confirmation that Muscat is personally involved with Schembri and Mizzi,” Busuttil alluded to the offshore companies the two close officials have opened.

“We know where Muscat stands and everyone can pass judgement on this. This is an insult to people’s intelligence,” Busuttil said.

Joseph Muscat has retained Mizzi as a minister without portfolio within his own political purview, with the prime minister taking responsibility for energy. He has also reintroduced former home affairs minister Manuel Mallia to his Cabinet, after he was sacked back in December 2014.

“The day started with Mizzi and Keith Schembri together with Muscat in Castille. Nothing has changed… the Opposition will not let this matter die down, and we will keep expressing the public’s sentiment.

“We will keep on insisting that Mizzi, Schembri and Muscat shoulder their political responsibility and leave public office, now more than ever. We will take any lawful action not to allow Muscat damage our country any more.”

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Mizzi will also resign the Labour deputy leadership for party affairs which he assumed in a one-horse race following Toni Abela’s resignation to take up a post in the European Court of Auditors.

Keith Schembri, the PM’s chief of staff who opened his own offshore company along with Mizzi, will not be dismissed either.

Instead Muscat is reintroducing Manuel Mallia, the former home affairs minister who was sacked after his security driver fired gunshots at a motorist’s car involved in a hit-and-run back in December 2014.

The current environment minister, Leo Brincat, is to be nominated to the European Court of Auditors after Abela withdrew his nomination earlier last month. Parliamentary secretary for competitiveness José Herrera will be promoted to environment minister and parliamentrary secretary for health Chris Fearne is now health minister. Mallia will step into Herrera's role.

Chris Fearne is minister for health
Chris Fearne is minister for health
José Herrera is minister for the environment
José Herrera is minister for the environment
Manuel Mallia is parliamentary secretary for competitiveness
Manuel Mallia is parliamentary secretary for competitiveness
Leo Brincat will be nominated to the European Court of Auditors
Leo Brincat will be nominated to the European Court of Auditors

Muscat has also taken a decision before the publication of an independent tax audit into Mizzi’s offshore interests. “My indications are that despite no conclusions, I can confirm there are no funds or monies involved. The Tax Compliance Unit’s and independent firm’s audits can take months and are not straightforward. I felt comfortable taking this decision.”

“I take my decisions with proportionality,” Muscat said, insisting that his government was one that takes action. “This government has delivered the most. People expect us to continuing working even more and make up for mistakes.”

Opposition leader Simon Busuttil instantly greeted the news by saying that nothing had changed inside Muscat's Cabinet:

 

Muscat said that Konrad Mizzi will still work inside the OPM, reporting directly to him, and that he will be given ‘special tasks’. “The first will be the implementation of energy plans,” he said referring to the as yet unfinished LNG plant Mizzi was in charge of.

“The signs are clear that even though nothing illegal has taken place, we must send a signal,” Muscat said referring to Mizzi’s admission to have opened an offshore firm in Panama to settle into an offshore trust in New Zealand.

“I will give Mizzi the work I know he will be best able to deliver,” he said.

Mizzi has been accused of attempting to avoid tax on his foreign assets and even to use the company for brokerage fees on future business earnings.

Muscat also defended his chief of staff Keith Schembri, saying his aide hailed from the business world, and was appointed to his position on the basis of “personal trust, not public trust.”

The upshot of Muscat’s decision, as the first questions he fields from the press show, is that his reshuffle is a cosmetic measure.

“It is an important political change. It would have been cosmetic had I put Mizzi on another portfolio, but I will direct his decisions,” Muscat said, saying that it was his priority to deliver on his government’s promise to switch over to gas.

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